Hire employees in Georgia
What a foreign company needs to know before employing people in Georgia, the country in the South Caucasus: whether you need a local entity, what an employee costs with a 20% flat income tax and a 2% employer pension, how notice and severance work, and what the work permit rules in force since 1 March 2026 mean for foreign hires. Written for CHROs, CFOs, General Counsel and founders.
Employer of record in Georgia: quick answers
The questions leadership teams ask first.
Do I need a local entity in Georgia to hire?
No. There are three routes:
- Employer of Record. Dryft Global employs the person in Georgia through a compliant local employer, issues the written contract, runs monthly payroll, withholds income tax and pays the pension contribution. You direct the work.
- Direct local entity. You register a limited liability company with the National Agency of Public Registry, often in 1 working day with no minimum capital, then set up tax registration and payroll.
- Independent contractor. Lawful only for genuinely independent services. Where the person works under conditions you organise, the arrangement can be treated as employment.
When should I use an EOR instead of registering locally?
Use an EOR for your first hires in Georgia, and especially where a foreign national needs a work permit under the rules in force since 1 March 2026. Your own entity earns its keep for a sustained team, Georgian customers, or an IT business that will apply for International Company status, which cuts employees' income tax to 5%.
What does an employee actually cost beyond salary?
Very little by statute. Georgia has no social security charges other than a funded pension: the employer pays 2% for Georgian citizens and permanent residents and nothing for other foreign employees. On a GEL 6,000 monthly salary that is GEL 120. The employee pays 2% pension and 20% income tax, keeping about 78% of gross.
How difficult is termination in Georgia?
Dismissal needs a ground listed in the Labour Code, such as staff reduction, a mismatch of skills or a gross breach of duties. For economic and capability grounds the employer gives either 30 days' notice plus at least 1 month's pay, or 3 days' notice plus at least 2 months' pay. Employees may ask for written reasons and challenge the dismissal in court within 30 days.
Can Dryft Global legally employ my team in Georgia?
Yes. Dryft Global employs your team through a compliant local employer. We issue written contracts, withhold income tax and pension and pay them by the 15th, pay the employer pension contribution, apply for work permits for foreign hires, and manage leave and termination.
Hiring routes compared
Speed, set-up burden and liability differ by route.
| Factor | Direct local entity | Dryft Global EOR | Independent contractor |
|---|---|---|---|
| Time to first payroll | Days to 2 weeks | Days to 2 weeks | Days |
| Local entity required | Yes, LLC | No | No |
| Withholding and pension | Your registrations | Handled by Dryft Global | Contractor's own taxes |
| Foreign hire work permit | You apply as employer | Dryft applies as employer | Self-employment permit needed |
| Statutory liability | Direct corporate exposure | Assumed by Dryft Global | High if the work looks like employment |
| Best fit | Sustained team, IT entity | First hires, engineering teams | Short independent projects |
What an employee costs in Georgia
Georgia's only statutory payroll contribution is the funded pension. The model below is a Tbilisi software engineer on GEL 6,000 gross a month in 2026, a Georgian citizen on the standard tax regime.
| Component | Employer share | Notes |
|---|---|---|
| Funded pension | 2% | Citizens and permanent residents; employee also pays 2% and the state adds a top-up |
| Other social security | None | No health, unemployment or social insurance charges |
| Total employer on-cost | 2% | GEL 120 a month at GEL 6,000; nil for foreign employees without permanent residence |
For an employee on GEL 6,000 a month, budget roughly GEL 73,440 (about USD 28,300) a year before the EOR fee and any optional benefits. The employee's net pay is GEL 4,704 a month after 2% pension and 20% income tax. Under International Company status the same employer cost gives net pay of about GEL 5,586. Private health insurance and bonuses are extra. Ask us for a cost model with current rates applied.
Payroll and tax
Salary is paid in lari at least monthly. The employer withholds 20% income tax and the 2% employee pension when it pays salary, adds the 2% employer pension, and files and pays by the 15th of the following month. Overtime is paid with the next monthly salary, late pay carries a penalty of 0.07% a day, and the final settlement is due within 7 calendar days of termination.
Income tax
Employment income is taxed at a flat 20% with no personal allowance or deductions. Employees of a company with International Company status, available for permitted IT and certain other activities, are taxed at 5%. Employees taxed at source generally do not file an annual return.
Minimum wage 2026
The general private-sector minimum wage is GEL 20 a month under a 1999 presidential order, far below market pay. Doctors and nurses in the state universal health care programme have hourly floors of GEL 7 and GEL 4.4.
Leave and mandatory benefits
- Annual leave. At least 24 working days of paid leave, which may be requested after 11 months, plus up to 15 working days unpaid.
- Public holidays. 18 public holiday days in the Labour Code for 2026, including Orthodox Christmas, Orthodox Easter, Independence Day and Giorgoba.
- Sick leave. Incapacity suspends the contract. The Labour Code does not itself require pay, so confirm the pay obligation and set the sick pay policy in the contract.
- Maternity and parental. 126 days of maternity leave within 604 days of parental leave; 183 days are paid by the State Budget, with the state allowance capped at GEL 2,000.
- Paternity. No separate paternity leave; fathers use parental leave.
- Working time. 40 hours a week; overtime only by agreement, at an increased rate the parties agree.
- Common extras. Private health insurance, bonuses, flexible hours and remote work.
Termination and notice periods
Probation can last up to 6 months, and the employer may end the contract during probation without the standard notice and severance. After that, the rules are as follows.
| Item | Rule |
|---|---|
| Economic, capability and similar grounds | 30 days' notice plus at least 1 month's pay, or 3 days' notice plus at least 2 months' pay |
| Employee resignation | 30 calendar days' written notice |
| Written reasons | On request within 30 days; reply within 7 days |
| Collective redundancy | 45 days' notice to the Minister and employees, with consultation |
| Final settlement | Within 7 calendar days |
- Listed grounds. Dismissal must rest on a ground in the Labour Code.
- Court challenge. Within 30 days of the written reasons; remedies include reinstatement or compensation plus lost earnings.
- Long-term incapacity. Dismissal only after more than 40 consecutive days, or 60 days in 6 months, once annual leave is used.
Can I use independent contractors?
Only for genuinely independent work. The Labour Code treats work performed under conditions organised by the employer, for pay, as employment, beginning when work actually starts. Set hours, your managers, your tools and a fixed monthly fee all point to employment. Individual entrepreneurs with small business status pay just 1% of turnover, which makes contractor engagement attractive on paper, but the substance of the relationship decides. Foreign self-employed people now also need a right to work. Georgia has no specific regime for staff leasing, so the employing structure for client-directed roles should be confirmed with counsel for each hire. For anyone who works like an employee, an EOR set up through a compliant local employer is the safe route.
The legal framework in brief
Georgia is a civil law system where the Labour Code, reformed in 2020 to align with EU directives, sets minimum terms. The instruments you will hear most:
- Labour Code. Written contracts for work over 1 month, probation, working time, leave, notice, severance and collective redundancy.
- Law on Funded Pensions. The 2% employer and 2% employee contributions and the state top-up.
- Tax Code. 20% income tax, the 15% distribution-based corporate tax and the International Company regime.
- Law on Labour Migration. Work permits for foreign nationals without permanent residence since 1 March 2026, with a labour market test and a GEL 50,000 employer turnover condition.
- Data protection. Law No. 3144 of 2023, supervised by the State Audit Office since 2 March 2026, with 72-hour breach notification.
- Corporate tax. 15% on distributed profits only, VAT 18%, and no treaty of Georgia's own with the United States, where the old US to USSR treaty still applies.
- Authorities. The labour ministry, the Revenue Service, the Pension Agency and the Labour Inspection Service.
Where the talent is
Georgia has a population of 3.94 million, with unemployment of 13.8% in the second quarter of 2026. The average wage was GEL 2,389.3 a month, and information and communication was the highest-paid sector at GEL 4,400.4. Georgian is the official language, and Russian and English are widely used in business. Georgia is on UTC+4 with no daylight saving. It has been an EU candidate country since December 2023, and its accession process is currently stalled.
| Region | Talent and industry concentration |
|---|---|
| Tbilisi | Capital, about one third of the population, technology, finance and services |
| Batumi | Black Sea port city, tourism, logistics and remote workers |
| Kutaisi | Western regional centre, education and services |
Georgia Implementation Kit
This page tells you the rules. The kit tells you what to do, in what order, and what goes wrong when you skip a step.
- Step-by-step checklist, from route selection to first payroll
- Written contract, probation and leave eligibility
- Gross to net and employer cost set-up
- Monthly withholding and pension calendar
- Work permit steps for foreign hires since March 2026
- Contractor and International Company checklist
- Every official Georgian authority with direct links
Hiring in nearby markets
Employer of record and hiring guides for other countries in Europe: Germany · Greece · Hungary · Ireland · Italy · Latvia · Lithuania · Luxembourg. See all global hiring guides or compare routes in EOR vs PEO vs entity.
This guide is general information, not legal, tax or immigration advice. Georgia's work permit rules took effect in March 2026 and are still bedding in. Confirm current figures and the employment structure with a qualified adviser or with Dryft. Last reviewed November 2026.
Ready to hire in Georgia?
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